Suit against hospital agreement sought

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A citizens’ group is pursuing a legal challenge against a deal to rebuild Peninsula Medical Center, even as ballots pour in for an election seeking approval of the deal.

The Peninsula Guardians announced Wednesday evening that they’re still pursuing a lawsuit against the chief county elections officer, Mills-Peninsula Health Services and the Peninsula Health Care District, a legal fight that promises to go beyond the time frame of an election regarding the new hospital. The lawsuit was filed after a July 28 San Mateo County Court ruling denied the Guardians’ request to stop the special election that is now in progress on the project.

Mills-Peninsula, the company that runs the Peninsula Medical Center, has offered to pay for the construction of a brand-new $488 million hospital at 1783 El Camino Real in Burlingame. The hospital building at that location does not meet seismic safety standards for hospitals that will take effect by 2013.

Voting is already under way for Measure V, a special mail-in ballot asking some 101,000 residents within the Peninsula Health Care District to vote on the project and a lease agreement between Mills-Peninsula and the Peninsula Health Care District, which owns the land on which the hospital sits. Ballots are due Aug. 29.

Though all parties involved have approved the plans and the 50-year lease agreement — which includes a provision that the district can buy back the hospital when the term expires with money saved from annual rent — the Peninsula Guardians remain skeptical that the lease agreement represents a good deal for the taxpayers.

The Guardians, a nonprofit watchdog group formed in response to the hospital project, argue that the agreement doesn’t give the district, apublic agency, enough control in the deal, the group’s attorney, Mitchell Green, said. For example, it doesn’t prevent Mills-Peninsula from demanding or receiving more public property, assets and financial support from the district without voter approval. Additionally, it grants a 50-year lease for public hospital property, which is more than the 30 years permitted by state law, Green said.

Green said the group is also suing the county elections office because they think election materials don’t properly explain what voters are deciding.

If the group’s legal efforts are successful, a court decision could invalidate a majority vote for Measure V, Green said.

"The voters can’t approve something that is illegal," Green said.

The district has until Aug. 27 to respond to the lawsuit. Though the group has requested meetings with district officials, board member Susan Smith said members of the public had plenty of time to air these concerns.

"I personally think we’ve spent six years getting to this point and [the Guardians] were present at many of our public meetings," Smith said. "[The lease agreement] is by no means perfect, but there are a lot of controls built into it and I think this will work for the future."

Mills-Peninsula officials agreed, saying negotiations are complete.

"As far as we’re concerned, the deal is done," said Margie O’Clair, MPHS vice president of Planning and Marketing. "The final say-so is in the voters’ hands."